Advice and Opinion

Innovative financing solutions being unlocked for commercial property growth

Gaining traction as a small business is not easy in today’s volatile economic climate. So when a long-standing Standard Bank client in the small mining town of Burgersfort approached the bank for urgent assistance in building a new Toyota dealership, it was a matter of quickly assessing the business value of the proposition and then structuring a solution to ensure the deal would not fall through.

This development was already two and a half years behind schedule as the zoning approval had not been forthcoming. Significant capital had already gone towards the expansion and time was of essence. Standard Bank’s Commercial Property Finance division realized that an innovative structured solution going beyond a plain vanilla mortgage bond would be required to ensure this deal still happened.

Harnessing significant sectoral expertise with the on-the-ground presence, Brett Webb, Head of Specialised Lending: Business and Commercial Banking at Standard Bank, helped structure the ideal solution.
‎General Manager at Burgersfort Toyota, Bilaal Tayob, says while it is not an easy process to receive bank funding as a small business in today’s environment, Standard Bank and Mr Webb played a “vital part” in bringing this project to fruition.

“They were very helpful and passionate about the potential and played a key role in assisting us, as well as empowering a lot of people in the process,” he says.

The dealership had been in existence for 27 years prior to the upgrade, but the expansion would inject as much as R65 million into the town, of which Standard Bank funded R25 million.

Extremely well located, next to a thriving mall, the potential of this development was obvious to see as it would create jobs and walk-through shoppers for a town that is booming – despite all the negative headlines about the demise of small towns across the country.

“Yes, this was a very under-developed area, but it is now bursting at the seams. A structured, tailor-made financial facility was needed and the specialist assistance from Standard Bank was crucial to facilitate this,” says Tayob.

Mr Tayob’s advice to prospective small business owners is to harness relationships you have and never give up. His family, for example, has had an 80-year relationship with Standard Bank.

“Times are tough and it is hard running a business, but there is potential to grow in our market. The consumer market is definitely growing, despite industries like mining waning,” he says.

The key is to be able to unlock these opportunities for growth, with Standard Bank’s Commercial Property Finance division focusing on providing financing solutions for both owner-occupied and investor property clients to facilitate growth and development across numerous sectors.

“Access to finance is one of the biggest hurdles for smaller and commercial businesses. As South Africa’s leading business bank, we understand the need for specialist product expertise, strong local capacity and global distribution reach to drive solutions,” says Mr Webb.

“Deciding to start your own business takes passion and true determination and we’re here to support you every step of the way,” he concludes.